Assets like shares have benefited from low interest rates in recent years but as the yield rates head up markets are getting nervous that could all change.
The S&P/NZX 50 fell 1.52 per cent to 8287 points in early trading.
A2 Milk was down over 3 per cent to $9.04, Fisher and Paykel Healthcare fell 2.8 per cent to $12.98 and Fletcher Building was down 2.2 per cent to $7.78.
Greg Fleming, head of investment strategy at AMP Capital, said he was surprised the New Zealand market had not dropped more.
"1.5 per cent looks quite a resilient performance for the first market to open."
Fleming said the fall may have been softened by a strong end to the week from the Australian share market.
"The Aussie market closed reasonably well."
Fleming said it may also be because New Zealand's share market didn't really participate in the big January rally seen in the US.
"Because they didn't have that big blow-off the sell-off [in New Zealand] is unlikely to be as big."
Fleming pointed to inflation numbers here which remain low, which means the Reserve Bank is unlikely to lift interest rates soon.
Mark Lister, health of private wealth research at Craigs Investment Partners, earlier predicted it could be a rough start to the week for New Zealand share market investors.
"We should expect an ugly day in this part of the world on Monday, although we might hold up a little better given our markets haven't been nearly as strong in recent months."
Lister said New Zealand and Australian shares were up 3.7 per cent and 2.2 per cent in the three months to January 31, compared with a gain of close to 10 per cent for US shares.
He said Wall St's pullback needed to be put into perspective.
"The recent sharemarket performance (particularly in the US) has been nothing short of exceptional.
"This time last week, the S&P 500 was up more than 12 per cent in just three months, while the 5.6 per cent rise in January was the strongest start to a year since 1997."
Lister said the markets were due for a decent pullback.
